Understanding The Definition of a Charity in Australia

We all understand the meaning of charity. It means to be doing something for someone else’s benefit. The business of being a charity is actually a complicated issue. In Australia, there is complicated legislation in relation to what it means to be a charity and how it must operate. These laws are quite sophisticated and can vary greatly from state to state. Most charities are non-profit organisations. This means they do not profit from their activities, but the people who work for the charities are paid. There have been a number of cases in Australia where charities have come under investigation because of the way and amount of donations monies, they have been using for their own use. Some of those police investigations have led to the directors of those companies being charged, and in other cases, the directors of those charities have shown they were using funds inside the legislation and regulations of their state and local area. What can be understood from this, is simple. The laws and regulation of charities is very complicated. Charities come in many forms. Some work for specific causes, and there is a growing trend in a new type of charity that specialises in the collection of money and then distributes to other specific charities. Charity Christmas cards is an excellent example of this.

• Original Laws. The formal legal definition of a charity is originally derived from the common law, Charitable Uses Act 1601. The laws relating to charity then grew from that based on several centuries of case laws related to this.
• Modern Laws. It wasn’t until recent times that specific laws related to charities were put in place. A growing dissatisfaction from the public at large led to the federal government of the time introducing the Charities Bill of 2003. This did not satisfy the public, and the bill was soon scrapped. Eventually, in 2004, the Extension of Charitable Purpose Act 2004, which has become the foundation of law related to charities in Australia ever since. The law itself is more of a code defining what is a charitable act and for what purposes.
• State Registration. Charities in Australia are required to register in their state of operation. This means the charity can only raise funds in that state, although those who donate can claim their donation as a tax deduction nationwide.
• Regulation. The body that regulates charitable organisations in Australia is therefore, the Australian Taxation Office. They have the best access to the financial dealings of any organisation.
• Fraud. For those organisations that have been involved in dubious activities, it is the directors of those organisations that are looking at serious federal crimes. The penalties for breaking the laws in relation to charities are very severe.

Operating a charity is a serious business. Without charities and other social welfare organisations issues that plague our societies, such as domestic violence and homelessness, would not have been dealt with as much as they have been to date.